USDA adjusts dairy forecast

In the new U.S. Department of Agriculture supply and demand report, the milk production forecast for 2023 was left unchanged from last month. The outlook for 2024 declined due to lower dairy cow inventories and slower growth in milk per cow. Dairy exports were cut for this year, reflecting lower butter, cheese and whey shipments. The weakness in butter exports is expected to carry over into next year. For 2023, prices for cheese, nonfat dry milk and whey are lower than the previous month’s forecast based on large supplies of cheese and competition in the NDM and whey markets. The Class III price forecast is reduced for this year and 2024.

Summertime blues

Even the most efficient dairy farmers are struggling with the current price situation. A quarterly report from the CoBank Knowledge Exchange said USDA’s estimated milk price to feed-cost ratio is at its lowest level since 2012. Profitability is expected to bottom out in July and August before improving considerably this fall when Class III prices are forecast to increase about $3 per hundredweight. This downturn in milk prices is due, in part, to poor exports. South Korea is the second largest U.S. cheese customer, and sales are down 20% for the first four months of the year. Mexico is the No. 1 buyer of U.S. cheese, and they are trying to make up the difference with a 14% increase in export volumes this year.

Farm loan numbers decline from 2022 

As interest rates pushed higher, farm lending activity at commercial banks slowed during the first half of the year. The quarterly report from the Federal Reserve Bank of Kansas City said the drop was due to a lower average loan size and fewer farm loans compared to one year ago.  As interest rates moved up rapidly over the past year, variable rates have become more common.

Bill introduced to support dairy businesses

Wisconsin Sen. Tammy Baldwin and Tennessee Sen. Marsha Blackburn have introduced the Dairy Business Innovation Act of 2023. This bipartisan proposal will reauthorize and strengthen the Dairy Business Innovation initiatives that passed as part of 2018 farm bill. “I’ve heard directly from dozens of Wisconsin dairies that have expanded their businesses thanks to the Dairy Business Innovation Initiatives, and I’m proud to lead the charge to ensure this program has the resources it needs to help more businesses innovate and grow for the future,” Baldwin said. Since the program was created in 2019, DBI Initiatives have supported over $150 million in awards through regional centers nationwide. The new proposal will increase funding for these initiatives from $20 million to $36 million per year.

Competition, not consolidation 

The White House and USDA met with representatives of 16 food and agriculture organizations July 13 to discuss the need for more competition in agricultural markets. According to a White House summary, the administration said consolidation can reduce the options for seed, fertilizer and farm equipment. The groups participating in the listening session included American Farm Bureau Federation and the Campaign for Family Farmers and the Environment.

US-China trade opportunities

U.S. Secretary of the Treasury Janet Yellen spent four days in Beijing, meeting with Chinese leaders. During the trip, Yellen said there is “ample room” for the United States and China to enhance their trade relationship. Despite recent tension between the two superpowers, 2022 was a record year for bilateral trade. Yellen’s visit is the second trip to Beijing by a Biden administration cabinet member in less than a month.

Budget signed into law

Wisconsin Gov. Tony Evers has signed the 2023-25 budget. For agriculture, the bill includes support for the Dairy Processor Grant Program and the Producer-Led Watershed Protection Grant Program. The budget features $150 million for the new Agricultural Road Improvement Program. A total of $6.5 million is devoted to nonpoint source pollution abatement.

WFU meets in Chippewa County

The Wisconsin Farmers Union summer conference was held at Lake Wissota. A new WFU building project in Chippewa Falls was discussed. WFU purchased the building for its offices. In addition, a restaurant and retail locations are planned.

WDE to remain in Madison 

Madison, Wisconsin, will continue to host World Dairy Expo through 2028. A new five-year contract was signed for the massive dairy event. Madison has hosted every World Dairy Expo since its inception since 1967.

Torres Small confirmed as No. 2 at USDA

Xochitl Torres Small has been confirmed by the Senate as the next deputy secretary of agriculture. Torres Small has served as an undersecretary at USDA since 2021 and was a member of Congress from New Mexico for one term. Torres Small was confirmed by the Senate on a vote of 79-8.

DFW elects officer team

Janet Clark, who is a dairy farmer from Rosendale, Wisconsin, was unanimously reelected as president of the Dairy Farmers of Wisconsin. Gail Klinkner of Viroqua, Wisconsin, was elected vice-chair. The DFW secretary is Sandy Madland of Lyndon Station, Wisconsin, and Mark Crave of Watertown, Wisconsin, is treasurer.

Hero of hope

Bob Nash has been honored as the Wisconsin Farm Bureau Hero of Hope award winner. Nash works at Golden E Dairy Farm at West Bend, Wisconsin. When a fire occurred at a nearby dairy farm, Nash relocated the cattle that survived the fire and organized the debris cleanup.

Dairy workers on strike

The union for employees at the New Dairy Select Milk at De Pere, Wisconsin, is on strike. The company’s health care plan is the sticking point for the labor dispute. Borden Dairy is the parent company for the De Pere sour cream facility.

‘Top Chef’ coming to Wisconsin

The 21st season of the “Top Chef” television show will take place in Milwaukee and Madison. Evers welcomed the news. “We’re proud to be known here for our rich food culture, talented chefs and exceptional local ingredients,” Evers said. As America’s Dairyland, dairy products will likely garner a lot of attention during the Wisconsin-based broadcast.

Trivia challenge

Dippin’ Dots is the ice cream company that bills itself as “the ice cream of the future.” That answers our last trivia question. For this week’s trivia, when is National Ice Cream Day? We will have the answer in our next edition of Dairy Star.

    Don Wick is owner/broadcaster for the Red River Farm Network, based in Grand Forks, North Dakota. Wick has been recognized as the National Farm Broadcaster of the Year and served as president of the National Association of Farm Broadcasting. Don and his wife, Kolleen, have two adult sons, Tony and Sam, and five grandchildren, Aiden, Piper, Adrienne, Aurora and Sterling.